Dropshipping is increasingly becoming a popular way of selling online. It is one of the easiest, most cost-effective, and smartest online business approaches.
If you are still not aware of what actually dropshipping is, let me introduce you to a process wherein your customers place an order on your web store. Next, the shipment travels to them directly from a third-party supplier’s warehouse. If you run an online dropshipping store, you can bypass having to store the items at your physical location!
How to Start & Run a Profitable Online Drop Shipping Store
Normally, your business has to maintain inventory on hand; when the customer places an order, you get the packaging done and ship it to the customer. When a drop shipper is involved, the process looks a bit different, and in fact, it makes things ten times easier for you. A customer orders products from your website, you pass the order information to the drop shipper who packages the goods and ships them directly to the customer.
What are the benefits of dropshipping?
One of the biggest benefits is that you can run an online dropshipping store without having to invest tens of thousands of dollars. But that’s not just all about drop shipping, and here are more reasons to consider a drop-shipping business model for your eCommerce startup.
1- As dropshipping eradicates the need to keep inventory on hand, your business can save a lot of time, labor, and overhead costs of keeping your goods (maintaining a warehouse to store goods).
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2- It allows you to offer items that would normally be impossible to ship, maybe due to location or inability to store goods, like particularly large or perishable goods.
3- You can offer a better price than your competitors. Because drop shippers are often large businesses dealing with many orders a day, they can offer you rates that are lower than the ones your small or medium business can get otherwise.
4- Dropshipping also decreases the losses from damaged products, as the shipments take a more direct route from the warehouse to the customer.
5- Since your drop shipper takes care of the entire packaging and shipping, it prevents you from all logistical headaches and customer service distresses.
6- You don’t have to worry about overstock or shortages.
7- It eliminates the risk of changing trends that may cause certain products to fall in or out suddenly.
8- Expanding your business is easier with drop shipping. You do not need to invest any huge amount, but still, you can expand your store.
So, How Do I Get Started and Start My Online Store?
So you’re sold on the idea to run an online dropshipping store, but you don’t really know where to start! This article will guide you through a step by step process to establish your dropshipping based eCommerce store, and here it goes:
Step 1: Finding a Profitable Niche:
This is the most important step to run an online dropshipping store; you must know what people are looking for and offer them various options. Clothing and accessories are among the least risky businesses, yet it is high in demand, as long as you offer high-quality products. Selling pop culture merchandise through dropshipping can be a lucrative business opportunity; you may start an online culture merchandise store or use such products to increase sales, as these are the products loved by almost everyone.
Thankfully, you don’t need to spend time obtaining a license for pop culture products anymore, as you can find and sell new licensed products of movies, games, comics, and more using MXED. You can start selling merchandise of your choice immediately by adding products to your Shopify store. The orders are shipped directly to your customers without being involved in the tedious packaging and shipping process. All you need to focus on is to drive targeted traffic to your store.
No matter what core product line you have, pop culture merchandise can just make your online store more appealing. MXED has licensed products of DC Comics, Harry Potter, Pokemon, Star Wars, Crunchy Roll, Warner Brothers, Marvel, Disney, Nickelodeon, Nintendo, Call of Duty, Capcom, Halo, Fallout, Rick & Morty, and more. You can create a huge eCommerce store that sells an awesome new collection of bags, tees, dresses, footwear, headwear & accessories for almost all age groups and interests without spending a penny in inventory and storage costs.
MXED can best be summarized as:
- Officially licensed Products – Now Shopify stores can sell StarWars products.
- US Based Suppliers
- Shipping in 3 Business days
Step 2: Fulfilling Legal Requirements:
If you are a US-based entrepreneur, you must know that you need to get a sales tax ID to operate a business. Some US states, including Alaska, Delaware, Montana, New Hampshire, and Oregon, do not require sales tax IDs, but others do. So, make sure to obtain your sales tax ID from the local office of your state’s department of taxation.
Applying for a tax ID is easy and doesn’t cost much, and you can do it either by visiting your local county clerk’s office or online. For example, if you are based in New York, you can find details on the New York State Department of Taxation and Finance Website.
Please note that you may require a business entity (company/sole proprietor) and have a Federal Tax ID Number (EIN) to get a sales tax ID. You can find complete details about EIN and how to apply online here at the IRS website.
Step 3: Setup Your Online Store:
Setting up an online store is easier than you can think of. You literally do not need to have coding knowledge. There are a lot of ready-to-use eCommerce platforms, and Shopify is one of the best. You can build your brand online with your own .com through Shopify in minutes. Hundreds of awesome store templates are available to choose from, and you can create the desired look and feel for your store without spending thousands on design and development costs.
Moreover, many apps can help you build a big store without spending a penny on inventory management and overhead costs. For instance, you can quickly and easily start dropshipping with Shopify by integrating the MXED app and automate your accounts using Intuit QuickBooks Online. Furthermore, there are many more free apps available for Shopify with which you can build a high-end online store with minimum effort.
Step 4: Start Promoting Your Store
The purpose of all the efforts we discussed in earlier steps cannot be achieved without promoting your eCommerce store. The benefit of using Shopify is that you have many free apps there using which you can promote your products effortlessly. You should not just rely on Shopify apps and must explore every option that can help you grow sales revenues. Here is a list of free marketing options that every startup must use. Moreover, it would help if you took the time to study customer behavior and align your social media, SEO, PPC, and email marketing campaigns accordingly.
Remember that store promotion is an ongoing process, and there’s always room for improvement. And it would help if you also had a sustainable growth plan ready; as you see, your store starts growing, you should have everything ready to take it to the next level.
Marketing Tactics for a Dropshipping Online Store:
There are many ways you could go about marketing when you run an online dropshipping store. One of the first ideas is garnering customer reviews and testimonials. Once you place your first few orders, ask for some feedback from your customers! This will boost credibility in no time.
If you’re going to run ads at all, as of 2020 Instagram and TikTok are two of the main channels you should be focusing on. Of course, your audience will vary depending on which channels you choose, so make sure you go with a platform that aligns with who your products will suit best. For example, you wouldn’t want to be marketing pet dietary supplements to teenagers, or hip/high-tech gadgets to an older crowd!
That said, you should create social media accounts for your online store—keep people up to date with your stock, new arrivals, and discounts. This will boost customer engagement and visibility on media channels.
This is not all to say that running an online dropshipping business will be a walk in the park. In reality, it’s a small investment but will take hard work to become a force online. You’ll need to really apply yourself, perhaps invest in analytics management, and most importantly, foster good relationships with the right suppliers.
It will be up to you to choose who you work with (or can access). It will also be your decision on how to market, and the internet can be unforgiving to low-effort marketing initiatives. You might not have to quit your day job to run an online dropshipping store, but you’ll need guidance, ample capital, and a determined mindset.
The Bottom Line:
You can start an online store with $Million worth of products in less than $1000 cash in hand through drop shipping, and it can grow bigger and bigger. But, like any other business, your online store will also have to face a lot of challenges, and you must be ready to face them all!
We hope that this article inspired you to run an online dropshipping store, and run it well! We wish you the best of luck. If you have experience with this topic, share your experiences in the comments below so our other users can learn a thing or two. Thanks for reading!